A phone call with the SEC

One of the posters from the Yahoo boards had a disturbing discussion with the SEC this afternoon. Here's his account:

"Richard" (not his real name) from the SEC just called me back. And the conversation went something like this:

Richard: I had your email question forwarded to me by John XXX. I spoke with our Trading Group and learned that the NASD and the NYSE do those calculations so the SEC doesn't have that information to disclose..

Me: Well, I believe you.. but your response makes me even more concerned rather than less. Because if that's the case, how would the SEC ever enforce "abusive" situations if they don't have access to the FTDs data?

Richard (now getting testy and defensive): Look, that's what I have been told... the SROs do the calculations and it's their responsibility to report abuses to the SEC..

Me: I'm not doubting your veracity, I'm just concerned that the SROs may not be doing a very good job self-regulating if you have the same companies appearing week after week since early December .. how does the SEC ever determine when "enough is enough" and begin an investigation?

Richard: Reg SHO is a new law..we need some time to evaluate it.. we're getting tons of calls on it.. we're trying to evaluate the situation.. That's all I can tell you.

Me: Well, I appreciate the information, but I am not satisfied with the answers..

Then we said good-byes.

Unless you feel otherwise, I'm writing again to Chairman Donaldson, referencing all my emails and calls and saying that, to many of us investors and Corporate Officers, this is clearly NOT acceptable enforcement practice.

It's analogous to Gang killings where the Chief of Police says "Hey, we've cut a deal with the Gangs to report any instances of murder, theft, etc.. so until they do so everything's ok".. Actually, it's worse... as in the Gang killings at least the public and Police can see whether the data (gang killings) is at a high rate, increasing, etc.. whereas with illegal Naked Selling the SEC claims to not even see the data !!